Friday, March 28, 2014

Regulatory Compliances Under Indian Companies Act 2013 In Pipeline

The corporate environment of India all set for a big
change that has brought tremendous regulatory obligations on the part
of Indian companies. The hints of such change
were obvious even before the recent notifications under the Indian
Companies Act, 2013 (PDF) by the Ministry of corporate
Affairs (MCA).

MCA has recently notified
183 sections under the Companies Act, 2013 and rules
for 11 chapters under the Act. A complete list of all
these notifications and the potential techno legal compliances that
Indian companies may be required to follow from 01-04-2014 is
available here.
The same has been provided by New Delhi based corporate and ICT law
firm Perry4Law.

According to Perry4Law, MCA has notified Rules for
11 chapters of the Companies Act, 2013. These include Rules for
specifications and definitions, incorporation of companies,
prospectus and allotment of securities, shares and debentures,
registration of charges, management and administration, declaration
and payment of dividend, accounts, appointment and qualification of
directors, board meetings and powers, and corporate social
responsibility.

As these Sections and Rules would become operational
from 1st April 2014 there would be lots of regulatory
compliance issues that would be involved. Similarly, it is not easy
to migrate from the 1956 Act to the 2013 Act so easily. The times
have changed especially due to the techno legal requirements that
Indian companies cannot
ignored anymore. These include cyber
law due diligence (PDF) and cyber
security due diligence, opined Perry4Law.

It would be in the best interest of all Indian
companies to manage their regulatory issues as soon as possible.
Further, it would take considerable time before the true implications
of the Indian Companies Act, 2013 and the corresponding rules
thereunder would be understood by the companies. Early starters would
definitely be at advantageous position.